Daily Archives: March 23, 2012

The Spanish risk premium shoots up to the 358 points to close

The Spanish risk premium, which measures the spread between bond yields and ten-year German national equivalent, has soared today to the 358 basis points at the end, but reached a maximum score of 361 in the session.

The risk premium has added 15 basis points in the session, affected by the lack of liquidity and statements released yesterday by the chief economist at Citi, Willem Buiter, who warned that Spain is closer than ever to the default.

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Spanish bond yields and ten years has risen to 5.49% today from 5.41% yesterday, while shares in Germany have ended the session at 1.91%, down from 1.98% the day before.

Buiter was skeptical about the situation in the euro area and noted that Greece may need a third bailout this year, while Portugal and Ireland would be forced to restructure its debt.

The President of the European Central Bank (ECB), Mario Draghi, has said that the worst of the crisis has passed, as the euro continues its bearish trend and stood just before the close below $ 1.32.

The risk premium has joined Italian now 16 basis points to 318, while the Greek country risk has closed 1,723 points, the Portuguese in 1074, the Irish, 494, and French, at 108.

The debt default insurance (credit default swap or CDS) relating to the bonds to ten years in Spain to cover the possibility of default on $ 10 million were changed to $ 417,410 per year, above of $ 415,780 the day before.